This Month in Corruption: Snapshots of the Public Trust Betrayed

Monday, December 26, 2016

If I were back in the newspaper business, I’d probably write a lead for this article containing the cliché, “Crime never takes a holiday.” 

Yes, clichés are the first resort of lazy-minded and hurried scribes, but the good thing is, they're usually accurate. 
So, with perfunctory apologies for interrupting your holiday cheer, I now present four separate accounts of public corruption in Massachusetts, which were all brought to culminations of sorts this month within a span of six days:

Embezzlement at Housing Authority.  On Tuesday, December 13, Rosa A. Famania, age 33, of Milford, pleaded guilty to one count of embezzling money from an agency receiving federal funds.  That agency is the Framingham Housing Authority (FHA), where Famania was employed as an accounting assistant for five-and-a-half years.
A press release from the Office of U.S. Attorney Carmen M. Ortiz states, “Between February 2014 and August 2015, Famania stole approximately 181 cash rental payments totaling $70,649 from FHA and utilized an FHA accounting software program to assist in disguising the theft...”

The release continues, “When Famania came into possession of the rent payments, she did not deposit the payments into the FHA bank account.  Instead, she kept the cash rent payments and adjusted the tenants’ balance downward…Approximately $55,100 in cash was deposited into an account maintained by Famania between July 2014 and July 2015.  From February 2014 to July 2014, nineteen U.S. Postal Service money orders totaling $17,900 were deposited into another bank account maintained by Famania.”
Famania will be sentenced for the crime, which carries a prison term of up to 10 years, on March 14, 2017.

Fraudulent Billing for Services. On Friday, December 16, Nita Guzman, age 52, of Burlington, was sentenced to jail and ordered to pay up to $570,000 in restitution for stealing from public agencies by billing for unlicensed psychological services.  
Guzman had pleaded guilty in Middlesex Superior Court to two counts of filing false Medicaid claims, one count of filing a false claim with a public agency, four counts of larceny, and two counts of practicing psychology without a license.  Her sentence to the house of correction was for 18 months.  After that, she’ll be on probation for five years.

According to a press release from the Office of the Massachusetts Attorney General, Guzman and her sister “orchestrated a criminal scheme to provide and bill for unlicensed psychological and mental health services for patients, including children, that they were not qualified to offer…”
The release continued, “Guzman’s twin sister, Nina Tischer, pleaded guilty in February 2016 to charges of False Claims to Public Agency (3 counts), Larceny (3 counts), Identity Fraud (3 counts), and Unlicensed Practice of Psychology (3 counts).  She was sentenced to two-and-a-half years in the House of Correction, suspended for a probationary period of five years…

“Through their corporations, both located in Lowell, the sisters provided bilingual psychological services to Medicaid and Medicare members in the greater-Lowell and greater-Lawrence areas, performed mental health disability evaluations for the Department of Transitional Assistance and the state’s Medicaid program (MassHealth), and assessed children for learning disabilities for Lawrence Public Schools.
“The investigation of Guzman began when a licensed psychologist reported to the AG’s Office that Guzman’s company had used her name and license number without permission to bill a Medicaid managed care organization more than $430,000.”

Theft from State Agency.  On Monday, December 19, Ennia Manto, age 52, of Braintree, the former Director of the Finance Division of the Massachusetts Group Insurance Commission (GIC), pleaded guilty to stealing more than $122,000 from the agency.  (The GIC is a quasi-independent agency  providing and administering health insurance and other benefits to state employees and retirees.) 
A press release from the Office of Attorney General Maura Healey states, “In June 2015, an accountant at the GIC discovered a wire payment for $72,349.83 that could not be reconciled with the GIC’s statements and internal documents.  Manto acknowledged that he made the transfer, claiming it was a payment to a health plan administrator for a nonstandard report.  Later, the accountant discovered that the required payment was for a different amount and not due for another year.  The GIC launched an immediate internal investigation and reported the matter to authorities.”

The release continues, “Upon learning that the wire transfer was being looked into, Manto altered the original printout of the wire transfer by cutting out information related to Seaport Equity, a company owned by Manto, and taping in information about the health plan administrator.  These documents were later found in a GIC recycling bin.  The contract documents that Manto had given to the accountant as backup documentation for the wire transfer had also been altered.
“Authorities subsequently confirmed that between March and June 2015, Manto made two wire transfers to Seaport Equity.  Further investigation revealed that Manto made an additional unauthorized wire transfer from the GIC’s funds to Seaport Equity in March 2015 for $50,000.”

Although the Attorney General’s office had recommended jail time followed by probation, Manto was ordered to make full restitution to the state and given three years’ probation.
Conspiring against Federal Regulators.  On Monday, December 19, Robert A. Ronzio, age 42, of North Providence, Rhode Island, national sales director for the New England Compounding Center (NECC) in Framingham, pleaded guilty in the federal district court of Boston in connection with an alleged conspiracy to defraud the Food and Drug Administration (FDA). 

Ronzio is reported to be cooperating with the government in its ongoing investigation of the center, where legal drugs were compounded, and he will not be sentenced until September 27, 2017.

A press release from the Office of U.S. Attorney Carmen M. Ortiz stated, “Ronzio admitted that NECC was a pharmacy dispensing drugs pursuant to physician-created prescriptions when it fact it operated as a manufacturer distributing drugs in bulk.  NECC created numerous work-around methods to make it appear to federal and state regulators that NECC was dispensing drugs pursuant to valid patient-specific prescriptions when it fact it was not.”
The release noted that “The NECC criminal case arose from the nationwide outbreak of fungal meningitis that was traced back to contaminated vials of preservative-free methylprednisolone acetate (MPA) manufactured by NECC.  The outbreak was the largest public health crisis caused by a pharmaceutical product.  The Centers for Disease Control and Prevention reported that 751 patients in 20 states were diagnosed with a fungal infection after receiving injections of NECC’s MPA.  Of those 751 patients, the CDC reported that 64 patients in nine states died.  The government’s investigation has revealed that those numbers continue to rise.

“In December 2014, following a two-year investigation, Ronzio and 13 other owners, employees, and associates of NECC were charged in a 131-count indictment.  The indictment did not charge Ronzio with having an active role in the drug manufacturing operations of NECC, but did charge him with conspiring to defraud the FDA.”


Reversal of Probation Dept. Convictions Means Ortiz Term Ends with a Whimper

Tuesday, December 20, 2016

Carmen Ortiz’s term as U.S. Attorney for the District of Massachusetts runs for only a few more weeks.  If she’s wishing it were over today, I’d understand. 

The biggest case Ortiz ever handled as the state’s top federal prosecutor, the alleged conspiracy to rig the entire hiring system in the Massachusetts Probation Department in favor of politically connected candidates, has fallen to pieces. The second-guessing has begun.

Lawyers all over town are saying: Why did she ever make a federal case out of patronage hiring on Beacon Hill?  This was never more than an Ethics Commission matter.  I’d hate to see how much the feds spent, the total number, on this case.

Late yesterday afternoon, the three-judge federal court of appeals for the First Circuit issued a ruling overturning the convictions of John J. O’Brien, 59, who served as Commissioner of Probation, the highest position in the department, from 1998 to 2010, and two of O’Brien’s deputies, Elizabeth Tavares, 58, and William Burke, 72.

Writing for the court, Justice Juan Torruella declared, “We find that the Government overstepped its bounds in using federal criminal statutes to police the hiring practices of these Massachusetts state officials and did not provide sufficient evidence to establish a criminal violation of Massachusetts law under the Government’s theory of the case.”

Back in March of 2012, right after she’d indicted O’Brien and his deputies, Ortiz held a press conference at the Joe Moakley courthouse in South Boston.  She emphasized, “This is a very serious matter.  We’ve just indicted three former state public officials who were supposed to be working on behalf of this Commonwealth and who were engaged in criminal activity.”

Ortiz opined, “There was a lot of patronage that was clearly going on (in the Probation Department).”  But patronage, “in and of itself, is not illegal,” she pointed out. 

“It could be very unseemly.  It could be criminal under some circumstances,” she said.  “But, in and of itself, it’s not, and we really have to be fair.”  

In 2014, a jury decided that O’Brien was guilty of one count of racketeering and conspiracy and four counts of mail fraud.  Tavares was found guilty of mail fraud, racketeering and conspiracy, and Burke of conspiracy.  Each of those convictions has now been thrown out.

Contrary to what Ortiz has been saying for over four years, there was no “criminal activity” in Probation.

The appeals court ruling in favor O’Brien et al. will send Ortiz, a resident of Milton, bleeding into retirement.  She’s the ultimate loser in a very prominent and potentially impactful case.  If the court had upheld these convictions, we’d now be discussing how the boundaries of patronage had been permanently redrawn.  Instead, we’re talking about the irreversible fading of Ortiz’s light in legal circles.

Ortiz’s defeat is also a blow to the legacy of the man who, in 2009, appointed her, President Barack Obama, even though, on balance, it’s more like a mosquito bite than a broken nose for a leader confronting the repeal of the Affordable Care Act, the rejection of the Paris accords on global warming, and the abandonment of the war-averting nuclear deal with Iran.

A little over two years ago, The Boston Globe published a brief editorial concerning the sentencing of O’Brien, which was then pending.  Recall that, in 2010, it was the Globe’s Spotlight Team that conducted an investigation and assessment of Probation Department hiring, which led to the independent counsel (Ware) report, which led to the indictments by Ortiz.

“It’s irksome to some that none of the lawmakers who supplied ‘recommendations’ to O’Brien, and then fattened his budget after he acted on them, have suffered any consequences, while O’Brien faces years in prison,” said the editorial, which was headlined, “John J. O’Brien’s sentence should send a warning on patronage.” 

The editorial continued:

“Nonetheless, that doesn’t exculpate O’Brien, and his conviction should be a warning to officials that if they claim to hire on merit, circumventing those rules will carry great risk.  Lawmakers can ask officials for favors, but if O’Brien’s sentence scares them into ignoring them, that would be a fine outcome.

“The fact that O’Brien has expressed no remorse almost dares Judge William G. Young to deliver a harsh sentence; prosecutors have asked for about 6 years.  But in itself, whether or not O’Brien apologizes doesn’t change very much.”

I know O’Brien only from the pictures taken of him entering and leaving the courthouse, wherein he always seemed grimly defiant and barely in control of his anger.  Given all that his death-match with the feds had to date cost him and his family – the loss of livelihood, savings, reputation, pension, future earning capacity, etc. – how could he be expected not to be peeved and pugnacious?

If he were ever then in the mood for apologies, I imagine O’Brien would have said he was sorry first to his wife for ever thinking it was a good idea to go on the public payroll.  The times were good when he was the King of Probation and even Ivy Leaguer judges meekly stepped out of his way.  Then The Boston Globe came calling and it all turned bad -- very, very bad.  Until yesterday. 
O’Brien’s a lot older than the passage of four or five years would otherwise suggest and he’s asking himself the old Ray Donovan question, “Which office do I go to get my reputation back?”  You don’t want to be muttering that when you’re pushing 60.

POSTSCRIPT: On Wednesday afternoon, Dec. 21, Carmen Ortiz announced her resignation. It will take effect on Jan. 13, 2017.

Here’s a link to the text of Judge Torruella’s decision overturning the O’Brien, Tavares and Burke convictions:



In Legislative Foray vs. Principals, School Custodians Gain a Short-Lived Victory

Friday, December 16, 2016

On December 1, both the Massachusetts House and Senate enacted a bill during informal sessions that would have made it harder for public school principals to fire custodians and other non-teaching employees for not doing their jobs right.

Eight days later, Governor Charlie Baker returned the bill unsigned, an action known as a pocket veto, having accepted the argument that the bill would weaken the authority granted to school superintendents and principals under the state’s momentous, acclaimed Education Reform Act of 1993.
Given the opposition of superintendents and principals to the bill -- House Bill 2319, An Act Relative to Protecting the Rights of Custodial and Other Non-Teaching Employees of School Districts -- I’m trying to figure out how the advocates for the bill got it passed during informal sessions. 

Only “non-controversial” measures are supposed to be taken up during “informals.”  Under the rules and customs of the Massachusetts legislature, if only one legislator present objects to voting on a bill in an informal session, the presiding officer must immediately table it for the entire session.  At that moment it is considered dead for the day.
The Republicans, as members of the minority party in the legislature, always send at least one member to every informal session whose specific job is to object if a controversial bill is unexpectedly brought up.  Controversial, in this context, means anything that does not enjoy unanimous support. 

It looks like the Massachusetts Association of School Superintendents was caught by surprise here. 
My guess is that the association, at the July 31 conclusion of formal legislative sessions, made the reasonable judgment that HB 2319 could not possibly get done during upcoming informal sessions; therefore, it did not see the need to impress upon sympathetic Republicans and Democrats alike the need to be on guard against it. 

Once the bill did slip across the legislative finish line, I surmise that the association swung into action in the governor’s suite, bringing about the pocket veto and quelling for now the rebellion of the custodians:  the governor’s action spelled the doom of HB 2319 because veto overrides are held only during formal sessions.
As just one result of the Education Reform Act of 1993, public school principals were given the power to “supervise the operation and management of their schools and school property, subject to the supervision and direction of the superintendent.” 

The law inserted a provision in Chapter 71 of the Massachusetts General Laws, Section 59B, stipulating that principals “shall be responsible, consistent with district personnel policies and budgetary restrictions and subject to the approval of the superintendent, for hiring all teachers, athletic coaches, instructional or administrative aides, and other personnel assigned to the school, and for terminating all such personnel…” 
Section 59B rather quickly became known as the “principal’s choice statute” in recognition of the significant additional power it had conferred upon school leaders.

HB 2319 seeks to diminish that power, which the Massachusetts Civil Service Commission has recognized as “broad” but not “unfettered.”  The bill would do that by amending the state’s civil service law, Chapter 31 of the general laws, to require that persons holding custodial, maintenance and other non-teaching positions be hired and fired in accordance with civil service rules if any given school department classifies those positions as civil service jobs.
The Association of Federal, State, County and Municipal Employees (AFSCME), the union representing non-teachers in many public school systems, has determined that a janitor in the crosshairs is going to do better before a civil service hearing officer who has never met him than a principal who knows him all too well. 

When testifying on behalf of HB 2319 at a hearing of the Joint Committee on Public Service on June 2, 2015, James Durkin, legislative director for Council 93 of AFSCME, said the bill “would correct the injustice of denying civil service rights to public school employees because they’re on a school budget and not a municipal budget.”
Gov. Baker, on the other hand, in his Dec. 8 letter to the legislature, made it clear that he sees the bill as a potential injury to the “managerial authority of public school principals.”  He wrote:

“That authority is at the heart of the Education Reform Act of 1993, which granted enhanced authority over internal school matters to the principals in order to increase their accountability in the preparation of our children to compete in the global economy.”
One public school superintendent I know says the power vested in principals by Section 59B “has absolutely helped to ensure the better performance of our public schools since the passage of the Education Reform Act.”  Here’s what this superintendent told me in an email earlier this week:

“In regard to the custodians, cafeteria workers and clerical help, these people are all major contributors to the schools and their ability to function well day to day.  The custodians not only clean the buildings, they also check all the time on the safety of the equipment used by the schoolchildren.  The cafeteria workers ensure proper nutrition and present the best foods in ways that are appealing to the students.  The clerical help are an integral part of the hour-to-hour operation of the schools and the school buildings; they are key to dealing effectively with parents and school personnel, as well as to maintaining student confidentiality and proper, accurate records.  
“The only sensible management approach is to have all teachers and non-teachers accountable to the principals, and solely to the principals, within the bounds of the law.”

The 2015-16 legislative session was the second one in a row where AFSCME fought for legislation taking away from principals the power to hire and fire non-teachers as they saw fit.  No doubt the union will be championing The Son of HB 2319 during the soon-to-be-upon-us 2017-18 session.   I’m no prognosticator.  But I don’t think the kid will do any better than dad or grandpa.



Every Citizen Has a Stake in Success of The Boston Globe's New CEO

Monday, December 12, 2016

“In 2016, the political climate and social media within the United States have identified, if not created, what I would call a factual imperative.  There has never been a greater need to help citizens distinguish between that which is true and that which is false, and to do so with a sense of purpose and a sense of fury.  It’s why we do what we do.”       
-John Henry, owner, The Boston Globe

From age 23 to 33, I was a full-time newshound, working as a reporter, then as an editor at the Evening News & Mercury daily newspaper group in Malden, Medford and Melrose.  Before that, during my college years, I worked as a reporter at the Chelsea Record, a small but pugnacious daily.  I was a  Northeastern University co-op student/kid reporter in Chelsea.
The respect I have for the craft of news gathering and the appreciation I have for the practitioners of that craft have only deepened through the years.  To sustain the life of our republic, we need strong and independent newspapers.  The Internet is wonderful and all, but we became a great nation without an Internet and could (theoretically) remain a great nation without the Internet -- but not without strong and independent newspapers.

Thus do I wish, sincerely, that Doug Franklin enjoys great success in his new role as chief executive officer of The Boston Globe, New England’s largest circulation newspaper, and that the Globe attains lasting financial stability during his tenure.
Today, the Globe has around 100,000 digital subscribers, for more than it did just a few years ago. But that number equals just one-tenth of the readers who pay to read the New York Times online.  Franklin’s job will be to increase digital subscriptions, and thereby advertising revenue, at a time when newspapers continue to lose print subscribers and see net advertising revenue decreases.  He has to make more people under age 40 care enough about the Globe to pay for its content online.  These tasks have defeated some of the greatest minds of American journalism and publishing.    

The Globe announced Franklin’s appointment in its online version this past Thursday afternoon and in its print edition this past Friday morning.  Also on Thursday afternoon, John Henry, owner of both the Globe and the Boston Red Sox, introduced Franklin to the newspaper’s employees in an internal memo, a copy of which found its way to my inbox.
“Doug is a seasoned newspaper executive, dedicating much of his career to Cox Media Group Properties and overseeing virtually all aspects of the business while leading change in each role along the way,” the Henry memo said.

The Henry memo noted: “Between 2013 and 2015, Doug was Executive Vice President and CFO of Cox Enterprises, the parent company of all Cox businesses including communications, media, and automotive.  Cox is an $18 billion company with 50,000 employees.  Prior to that, from 2010 to 2013, he rose from EVP to President of Cox Media Group, which is comprised of their TV, radio, newspaper, direct mail, and digital operations.  Doug has extensive experience as a newspaper publisher, overseeing four Ohio newspapers including the Dayton Daily News from 2004 to 2008, then becoming Publisher of the Palm Beach Post for a short but high-impact stint in 2008, and the Atlanta Journal Constitution until 2010.  Doug has experienced virtually every challenge our industry faces today – and succeeded at every turn.  As I’ve gotten to know Doug over the past few months, I’ve come to understand that he is fearless, energetic, articulate, and passionate in his desire to help the Globe achieve our long-term goal of creating a sustainable business model for high level journalism.”
Friday morning’s Globe article on Franklin’s appointment said: “A friend who learned of the Globe CEO search suggested to Franklin earlier this year that he would be a good fit.  Franklin was not looking for work at the time, though he acknowledged ‘retirement is pretty boring…I don’t have to work; I like to work.' ”

I don’t have to work.
Promisingly, this suggests that Franklin has the objectivity and freedom to make the truly best decision every time he has a tough choice to make at the Globe and there are powerful factors on either side of that decision.  “Clearly, there’s going to be lots of changes,” Franklin told the Boston Herald, (“Ex-Atlanta publisher to be Globe’s new CEO,” 12-9-16).

On the other hand, it might suggest Franklin does not have enough skin in the game.  As a journalism wash-out, I lack standing to pontificate on such matters.  Even wash-outs, however, stumble across truths in their working lives, such as the one imparted to me by a successful hospital CEO many years ago: For a big job, always hire someone who’s at a point where his career and future will be damaged if he fails in the job you are giving him.    

College May Have Averted Flag Debacle If They'd Consulted Stan Rosenberg

Monday, December 5, 2016

The brain trust that runs Hampshire College in Amherst thought it would be a good idea to lower the American flag to half-mast on Wednesday, Nov. 9, the day after Trump’s victory, “as an expression of grief over the violent deaths being suffered in this country and globally.” 

The college planned to raise the flag to its full height two days later, on Veterans Day.  After someone or some group took down the flag without permission on the night of Nov. 9 and burned it, the college’s board of trustees decided it would be nice to remove the flag altogether from public display on campus. 
Then the president of the college, Jonathan Lash, called for an open-ended dialogue on how the flag symbolizes different things, some of them quite horrible, to different people.  Some Hampshire students, he noted, “grew up victims of racism and injustice” and are troubled by the flag because it is a “symbol of a system that has been repressive.” 

That decision created a controversy that quickly spread beyond the college’s idyllic setting in the Pioneer Valley.  Veterans groups around the country were particularly outraged. Lash and his college got mauled in the media and on the Internet.  The president's appetite for dialogue seemed to diminish daily.  
This past Friday, Dec. 2, he announced his decision to put the flag up again at Hampshire.  

“…we were getting so many graphic, threatening calls and emails,” said Lash, “that I just felt it was safer to put the flag back up -- which we’d always intended to do at some point – and continue the discussion with it up.”
When the controversy was at a fever pitch, Lash took pains to point out that, for him personally, the American flag “is a symbol of the highest aspirations of our country, the things that I believe in that our country hopes to provide, in terms of liberty and opportunity and justice.”

But, but, he emphasized that he was “simultaneously profoundly aware of the differences in perception for marginalized communities who, as one student said to me, wake up every morning afraid, and who felt deeply and personally threatened by the toxic rhetoric, the racist rhetoric and Islamophobic statements during the (presidential) campaign.”
So, Lash was for taking down the flag and having a dialogue until that course of action became just too much trouble.  He loves the flag as a symbol of the highest aspirations of our country but does not believe enough in that symbolism to withstand the disapproval of anyone enjoying a high-priced Hampshire education while residing in one of the most liberal, most welcoming communities in the country, if not the whole world.

If he’d consulted Stan Rosenberg, the president of the Massachusetts Senate who lives in Amherst, Lash might have saved himself a lot of anguish, not to mention bad publicity and ill will throughout America.  Referring to the flag controversy, Rosenberg told the State House News Service on Nov. 28, “It’s really disappointing to see what’s happened out there.”  He added that he would “like to see the flag go back up as soon as possible.”
When the flag was torn down and burned on his campus, President Lash was at a crossroads, a place where he could have written his own little chapter in American history.  He could have called a morning-after press conference, held up a photo of the burned American flag, and declared:

“I am ordering that a new and larger flag be raised to the top of the pole at noon today, where it will remain as long as I am president of Hampshire College.  The flag that flies at our college symbolizes the highest and best aspirations of our nation.  End of story.  Everyone should return immediately to the business of getting the best education they can during the precious little time they have at Hampshire College.  Thank you.” 
Instead, Lash took what he thought was a safe choice, the middle ground, which has been the wide territory of mediocrity since time immemorial, the place one goes to get his ticket to oblivion punched.